The second allegation centres on a claim that Mr Netanyahu, Israeli prime minister since 2009, received more than $100,000 (£72,000) in gifts from Hollywood mogul Arnon Milchan and other supporters.

The Jerusalem Post says the gifts included champagne and cigars, and were given in exchange for help getting Mr Milchan a US visa.

Mr Milchan should face bribery charges, police said.

Haaretz newspaper reports that Mr Netanyahu, after receiving gifts, pushed for the Milchan Law, which ensures Israelis who return to live in Israel from abroad are exempt from paying taxes for 10 years.

What happens now?

A final decision on whether Mr Netanyahu should face charges will come down to the attorney general’s office.

Justice Minister Ayelet Shaked said any prime minister who has been charged should not be obliged to resign.

And speaking on Israeli television, Mr Netanyahu said he would continue in his role.

He said the recommendations made by police will “end with nothing”.

The 68-year-old is in his second stint as prime minister, and has served in the role for a total of 12 years.